Sherry FitzGerald profit jumps 64%

Estate agent Sherry FitzGerald recorded a 64 per cent profit boost last year despite warning that it will be a "number of years before we have a fully functioning property market".

Recently filed accounts for Sherry FitzGerald (Ireland) Holdings Limited show profit after tax increased from €2.24 million to €3.69 million in 2016 compared to the previous year.

The increase comes as “the historical commitment to invest and retain people during the challenging years of the recession began to bear fruit”, the company said.

However, in its business review the directors report that a supply and demand equilibrium is still a number of years out.

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Despite that, the company recorded an increase in sales of residential properties to 3,000 in its core business while its franchise partners sold 3,900 residential properties throughout the year.

“A functional property market is an essential prerequisite to a competitive economy and, in this context, the new Government’s housing policy announced in July 2016 was a welcome, though belated, initiative to increase the housing stock,” the report said.

Turnover at the company, founded in 1982, increased by more than 12 per cent last year to €37.29 million while staff costs rose to €26.3 million. Meanwhile, speaking to The Irish Times earlier this week, Sherry FitzGerald chief executive Steven McKenna said he expected revenues for this year to come in at about €40 million.

The bulk of staff costs went on wages and salaries for the company’s 316 employees, which amounted to €23.1 million, an increase of almost 11 per cent on the previous year when 299 staff were employed.

During the year the group’s commercial business, formerly known as DTZ Sherry FitzGerald, rebranded to Cushman & Wakefield following a merger. The rebrand “augers well for the future of our commercial business”, the company said.

In terms of future risks, the estate agent sees policy initiatives that would halt the supply of property as something that would lead to increased market dysfunctionality.

Other risks include “unforeseen changes in a global economic downturn”, something former chief executive Mark FitzGerald would have been familiar with throughout his time at the company before stepping down in July this year.

Mr McKenna said the company was satisfied with the results. “Despite the record low levels of residential stock available in the market, we saw our market share strengthen, transaction levels increase and revenues rise.”

“This has positioned us well for the future and enabled us to invest in our talent-management programmes and digital strategy throughout 2017,” he added.